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WHOLESALE MARKET gold prices hovered just below $1665 per ounce
Monday morning in London, having failed to hold onto gains in earlier Asian
trading, as stocks and commodities also ticked lower along with the Euro,
which retreated from recent highs following news of a political scandal in
Spain.
Silver erased most of Friday's gains this morning, dropping below
$31.60 an ounce.
The gold price in Euros meantime regained some ground this
morning as the Euro fell against the Dollar. Last Friday, gold in Euros
dropped to its lowest level since May last year as Euro-Dollar touched a
14-month high.
In New York, the so-called speculative net long position of Comex gold
futures and options traders fell to its lowest reported level since last
August during the week ended Tuesday 29 January, weekly data published Friday
by the Commodity Futures Trading Commission show.
The spec net long is calculated at the difference between 'bullish'
long and 'bearish' short contracts held by traders such as hedge funds which
are classified as 'noncommerical', and is regarded as an indicator of
short-term sentiment in the derivatives markets.
"The 'weak hands' are further retreating from the gold market,
which is a good thing in terms of the long-term price prospects," says
today's commodities note from Commerzbank.
Spanish prime minister Mariano
Rajoy, who travels to Berlin today for talks with German chancellor Angela
Merkel, denied
allegations in
the Spanish press over the weekend that he received illegal payments from a
slush fund run by his Popular party (PP).
Support for the PP has fallen
six percentage points to 24% since the allegations were made, according to a
poll published by Spanish newspaper El Pais, while 77% of those surveyed said
they do not approve of Rajoy.
The number of unemployed in
Spain meantime rose to 4.98 million last month, official figures published
Monday show. Last month brought news that the unemployment rate rose to
record levels above 26% towards the end of 2012.
In Italy, prime minister Mario
Monti today criticized his predecessor Silvio Berlusconi's proposal to
reimburse taxes paid on primary residences that were levied by Monti.
"Berlusconi wants to buy
the votes of Italians with the money that Italians had to turn over to cover
up the shortfall left in the public accounts by Berlusconi," Monti said.
A poll published last week
showed Berlusconi had cut the lead of front runner Luigi Bersani to five
percentage points ahead of elections in three weeks.
Bersani's Democratic Party
(PD) has faced criticism for allegedly receiving funding from Siena-based
Monte dei Paschi (MPS), the world's oldest bank dating back to 1472, which
is currently being investigated for covering up losses on derivatives
trades and overpaying for its 2007 acquisition of Banca AntonVeneta.
MPS lost an estimated 2 billion-plus in 2012, following a 4.6 billion loss in 2011.
In Germany meantime,
politicians have expressed skepticism over whether to accede to Cyprus's
request for a bailout from the European Union and International Monetary
Fund.
"Without the introduction
of effective controls on money-laundering and urgently needed structural
reforms, we need not even discuss financial aid," Rainer Bruederle, a
member of the Free Democratic party which shares power with Merkel's party,
said over the weekend.
"Cyprus is based on a
business model that damages us all," added Johannes Kahrs of the
opposition Social Democrats.
"Yet it is now supposed
to be saved by the EU. The SPD will not support that."
"There's general
unease...about the fact that Cyprus takes in a good deal of cash from
Russians," explains a note from Standard Bank.
Over in India meantime,
traditionally the world's biggest gold buying nation, Rupee gold prices fell
to five-month lows Monday as the Rupee touched its highest level against the
Dollar since October.
At the start of the year Indian
gold dealers imported increased quantities of gold ahead of a rumored import
duty hike, with the authorities duly raising the duty from 4% to 6% last
month.
"Not many deals are
happening [at the moment]," one dealer at a state-run bullion importing
bank told newswire Reuters this morning.
"[The] market has to
clear the old stocks, which could finish this week."
Ben Traynor
Editor of Gold News, the analysis and investment research site from
world-leading gold ownership service BullionVault, Ben Traynor was
formerly editor of the Fleet
Street Letter, the UK's longest-running investment letter. A
Cambridge economics graduate, he is a professional writer and editor with a
specialist interest in monetary economics. Ben can be found on Google+
(c) BullionVault
2013
Please Note: This article is to inform your thinking, not lead
it. Only you can decide the best place for your money, and any decision you
make will put your money at risk. Information or data included here may have
already been overtaken by events and
must be verified elsewhere
should you choose to act on it.
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